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Euro at risk below 1.0990: EUR/USD analysis

By Nathan Batchelor

EUR/USD analysis shows that the pair is vulnerable to heavy losses below the 1.0900 level. The recent decline has created substantial amounts of bullish MACD price divergence, which extends towards the 1.1085 area.

The EUR/USD slumped to its weakest trading level since October 2019 last week, as sellers broke through the 1.0990 support level.

EUR/USD analysis shows that if buyers fail to stage a strong reversal from current levels the pair is at risk of slipping towards the 1.0900 level and possibly lower.

EUR/USD medium-term price trend

Weak German factory orders data and broad based strength in the US dollar last week caused the EUR/USD pair to break key 1.0990 support level.

A strong reversal from the 1.1100 level and a subsequent loss of the 1.1060 support level increased bearish bets towards the EUR/USD.

EUR/USD technical analysis over the medium term shows that the pair now remains vulnerable to further losses, with price making bearish daily, weekly and monthly lower lows.

The price is now fast approaching the 2019 trading low, around the 1.0880 technical region. A loss of the 1.0880 support level could cause the EUR/USD pair to drop towards the 1.0710 level.

Traders who are bullish towards the EUR/USD pair may attempt to buy the pair around the 1.0900 to 1.0940 area and target a strong bounce back towards the 1.1060 level.

EUR/USD short-term price trend

EUR/USD technical analysis shows that the pair has a strong short-term bearish bias while trading under the 1.1090 level.

EUR to USD analysis shows that a bearish head-and-shoulders pattern has played out to the downside and is now close to completion.

Interestingly, the recent decline in the EUR/USD pair has created large amounts of bullish MACD price divergence across the lower time frames.

The 30-minute time frame shows that positive MACD divergence now extends towards the 1.1085 and certainly hints that the recent decline may soon be reversed.

Short-term traders that are bullish towards the EUR/USD pair would ideally likely to see price closing back above the 1.0990 level before initiating new buy positions.

Key short-term resistance for the EUR/USD pair is currently found at the 1.0990, 1.1030 and 1.1060 levels.

EUR/USD technical summary

EUR to USD analysis highlights that bulls need to defend the 1.0900 support level to avoid further losses. Bullish MACD price divergence is hinting that the pair may soon reverse higher.

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